The page will contain information about the recently passed
legislation that designates the Bay Islands Department of
Honduras as a 'Free Tourist Zone' (ZOLITUR). The page will be
regularly updated as more details and regulations become
available.
The information on this page is as reliable as we can make it but
has NOT been reviewed by the Bay Island Regime's
administration.
legislation that designates the Bay Islands Department of
Honduras as a 'Free Tourist Zone' (ZOLITUR). The page will be
regularly updated as more details and regulations become
available.
The information on this page is as reliable as we can make it but
has NOT been reviewed by the Bay Island Regime's
administration.
November 29, 2006.
On Wednesday, November 29, 2006, Honduran president Mel
Zelaya and the National Congress passed legislation establishing
the Bay islands as a “Free Tourist Zone” which will include the
islands of Roatan, Guanaja, and Utila. It was agreed that Cayos
Cochinos would be excluded from the free zone designation. The
following preliminary information was presented to residents
and guests at an open meeting on the matter.
The focus of the legislation is to promote tourism in the Bay
Islands. According to research that was conducted by the
government and private groups, the fishing industry (in past the
mainstay of the islands economy) has been declining over the
past few years and the ‘free zone’ was a means for continuing to
promote the islands and boost the economy as much of the
current revenues are now generated from tourism.
A governing council has been established and will be responsible
for administering the Bay Islands Free Zone as a semi-
autonomous department of Honduras. The governing council will
be led by the governor of the Bay Islands and will consist of
seven appointed representatives from the Bay Islands and three
ministers from the Federal government. This council will also be
responsible for creating the By-laws of the Free Zone law. The
governing council has been mandated to complete the By-laws
and present them to the president and congress no later than
March 30, 2007.
There is some uncertainty as to how non-tourism based
businesses will be affected by the Bay Islands Free Zone
designation. How the law will designate between tourism and non-
tourism business in not known and until the By-laws are written
and instituted the exact numbers for the reduction of taxes and
duties are unclear.
However, the government has already ratified some changes, for
tourism related business, that we can relate:
>No duty on goods shipped to the Bay Islands
>The current 12% sales tax will be eliminated
>The current 16% hotel/rental tax will be eliminated
>No income tax will be assessed
>The capital gains taxes will be reduced to 4%
We were informed that there will be no change in the laws for
obtaining residency here in the Bay Islands. It was also stated
that 1/3 of the revenues collected from fees and taxes will go
toward infrastructure, hospitals and education. The government
can opt to spend more than the requirement but must give at
least 1/3 of those funds to the islands to maintain
infrastructure, hospitals and education.
One concern for the Bay Islands that was addressed was travel
with firearms. The new laws stipulated that people are no longer
allowed to carry a firearms anywhere in the Bay Islands and
anyone found with a firearm will have it confiscated. Police,
military and licensed security guards are exempt.
While all real estate taxes and fees will remain unchanged, this
legislation will be another boon to the already brisk real estate
market in the Bay Islands. Land values will most certainly rise
due to this newly formed Bay Islands Free Zone. Permit and fees
for construction projects will most likely increase.
This is the first step towards creating a structure here that will
be much like that on the Cayman Islands and the Bahamas. The
government is looking at the current banking regulations with
an eye towards encouraging more participation here by foreign
banks as an additional means of improving the economy here.
Any updates or changes in the designations will be posted here
as soon as they become available. Click on Free Zone
Legislation for a translated copy of the current law.
Summary
The passage of this legislation is a clear indication of the
Federal government's recognition of the value of the tourism
business and economic growth of the Bay Islands. It will reduce
the cost of doing business here, provide for more investment in
the infrastructure, enhance the security functions and remove
the complexities of having to deal with the Federal government
on a daily basis. It will enable the Bay Islands of Honduras to
become a major player in the tourism business in the
Caribbean.
The passage of this legislation is a clear indication of the
Federal government's recognition of the value of the tourism
business and economic growth of the Bay Islands. It will reduce
the cost of doing business here, provide for more investment in
the infrastructure, enhance the security functions and remove
the complexities of having to deal with the Federal government
on a daily basis. It will enable the Bay Islands of Honduras to
become a major player in the tourism business in the
Caribbean.
|
July 22, 2007
The scheduled date for the enactment of the provisions of the
Free Tourist Zone laws has been reset to later in 2007 to allow
the required census to be completed, which has proved more
difficult than anticipated.
One of the provisions states that all persons and businesses that
qualify as a 'Bay Islands Regime' resident should be able to
import items into the Bay Islands duty free as long as the goods
are for the tourism business. The administrative details for the
implementation of 'duty free' importation are still being worked
out.
The collection of federal income tax in the Bay Islands will be
terminated as part of the enactment of the new laws. Bay Island
residents will not be taxed on income earned in the Bay Islands.
A new procedure for completing real estate transactions will
require that the seller pay a 4% net capital gains tax before a
property can be transferred.
The scheduled date for the enactment of the provisions of the
Free Tourist Zone laws has been reset to later in 2007 to allow
the required census to be completed, which has proved more
difficult than anticipated.
One of the provisions states that all persons and businesses that
qualify as a 'Bay Islands Regime' resident should be able to
import items into the Bay Islands duty free as long as the goods
are for the tourism business. The administrative details for the
implementation of 'duty free' importation are still being worked
out.
The collection of federal income tax in the Bay Islands will be
terminated as part of the enactment of the new laws. Bay Island
residents will not be taxed on income earned in the Bay Islands.
A new procedure for completing real estate transactions will
require that the seller pay a 4% net capital gains tax before a
property can be transferred.
November 11, 2007
The bylaws for ZOLITUR have been completed and will be
formalized by Honduran President Mel Zalaya in a ceremony
here on Roatan on December 13, 2007. The bylaws will be
published on that date and will contain the details that we've all
been waiting for. They will be published on this site when they
are electronically available.
The next step is to set up the administrative organization(s) to
enact them. This should be complete in the first quarter of
2008.
The bylaws for ZOLITUR have been completed and will be
formalized by Honduran President Mel Zalaya in a ceremony
here on Roatan on December 13, 2007. The bylaws will be
published on that date and will contain the details that we've all
been waiting for. They will be published on this site when they
are electronically available.
The next step is to set up the administrative organization(s) to
enact them. This should be complete in the first quarter of
2008.
December 17, 2007
Mel Zalaya, the president of Honduras, was on Roatan on
Saturday to preside over a ceremony that will begin a new era
for the Bay Islands. The legislation that created ZOLITUR has
gone into effect retroactive to December 13, 2007.
The administration office for ZOLITUR is located across the
main road from Banco LaFise in French Harbor. 'Let the good
times roll' !
Mel Zalaya, the president of Honduras, was on Roatan on
Saturday to preside over a ceremony that will begin a new era
for the Bay Islands. The legislation that created ZOLITUR has
gone into effect retroactive to December 13, 2007.
The administration office for ZOLITUR is located across the
main road from Banco LaFise in French Harbor. 'Let the good
times roll' !